There are tax withholding requirements for the foreign citizen or residents who sell US property.
Foreign Investors Real Property Taxation Act (FIRPTA) requires 10-15% of sales price be withheld for foreign ownership. Sellers can request a waiver or reduced withholding on Form 8288 B (tax id # required).
Additional California withholding requires that 3 1/3% of sales price or the alternative withholding amount be paid to the Franchise Tax Board.
If the seller fails to provide an ITIN on Form 593-C, the real estate escrow person will withhold 3 1/3% of the total sale price.
Ask an escrow, attorney, or accountant about possible exemptions.
